DESCRIPTION: Despite significant data, many believe that the financial pressures and management strategies associated with managed care threaten the quality of care. Managed care is not only the health plans themselves, but also the wide variety of provider organizations with which health plans contract, ranging from large physician groups to fully integrated delivery systems. This application aims to improve understanding of the effects of managed care?s financial and managerial strategies as they are implemented in the physician organizations where care is delivered. This application focuses on coronary heart disease (CHD), which has become an important area for quality measurement because of its cost and the linkage between quality measures and quality or length of life. CHD is the single largest killer of Americans and 85 percent of CHD deaths are in patients 65 years or older. Thus, CHD is an ideal clinical condition that can be used to explore the impact of managed care techniques on the quality and costs of care for both the under- and over-65 populations. The proposed research would utilize several new and individual measures of quality, including four HEDIS measures that would be reported in 2002 and a measure of the aggregate costs of care. These data would be combined with additional data from a large-scale survey study already funded by the AHRQ (HS09929). By April 2001, that study will have obtained detailed information on the administrative, financial, and management strategies in over 750 physician organizations affiliated with health plans in two geographic areas of this country (Boston, Massachusetts and Portland, Oregon). This research would allow better understanding of how financial and managerial characteristics of medical groups, including the method for group compensation by managed care plans as well as the method of individual physician compensation, affect the quality and costs of care.